US President Donald Trump has called the rise of Chinese company DeepSeek "a wake-up call" for the US tech industry, after the emergence of its artificial intelligence (AI) model triggered shockwaves on Wall Street on Monday.
Shares in major tech firms such as Nvidia fell sharply, with the chip giant losing almost $600bn (£482bn) in market value, BBC reported.
What has shaken the industry is DeepSeek's claim that its R1 model was made at a fraction of the cost of its rivals - raising questions about the future of America's AI dominance and the scale of investments US firms are planning.
DeepSeek has become the most downloaded free app in the US just a week after it was launched.
Responding to the news, Donald Trump said the latest developments in China's AI industry may be "a positive" for the US.
"If you could do it cheaper, if you could do it [for] less [and] get to the same end result. I think that's a good thing for us," he told reporters on board Air Force One.
Trump also said he was not concerned about the breakthrough, adding the US will remain a dominant player in the field.
DeepSeek is powered by the open source DeepSeek-V3 model, which its researchers claim was trained for around $6m (£4.2m) - significantly less than the billions spent by rivals. But this claim has been disputed by others in AI.
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